Yesterday the Joint Ways and Means Subcommittee on Transportation and Economic Development passed SB 5528, the biennial budget for “Business Oregon,” the Oregon Business Development Department. The Budget now heads to the full Ways and Means Committee for consideration.
The budget includes some key provisions endorsed by the Oregon Business Plan as major opportunities to lower Oregon’s stubbornly high unemployment and lagging personal income levels. These include:
The Oregon Innovation Plan
The Oregon Innovation Plan is now in its third round of funding and has delivered impressive results for the state. The Subcommittee allocated sixteen million dollars this biennium for the Innovation Plan, a suite of initiatives to enhance industry innovation and the commercialization of research. The funding will go toward three industry initiatives and three signature research centers. The industry initiatives include improving innovation and productivity in the food processing industry ($500k), catalyzing Oregon’s emerging electric vehicle industry ($1.2 million), and putting Oregon on the map for wave energy development and manufacturing ($2.5 million). The Signature Research Centers include the Oregon Nanoscience and Microtechnology Institute (ONAMI) ($5.3 million), Oregon Built Environment and Sustainable Technologies Center (BEST) ($3.8 million) and the Oregon Translational Drug Institute (OTRADI) ($2.8 million).
In the midst of a historic recession, the Oregon Innovation Plan has been successful at incubating new ideas into growing businesses, helping established industries become more competitive and creating a new economic future for all Oregonians. In less than four years of state funding, the six initiatives of the Oregon Innovation Plan have brought $195 million in federal and private grants back to Oregon and are on track to generate more than $7 for every dollar the legislature has invested, not to mention the creation of 1117 jobs and the incubation of 15 new companies.
For more details on how the funding will be used, visit http://www.oregon4biz.com/Innovation-in-Oregon/.
Strategic Reserve Fund
The budget that passed out of the subcommittee today includes $8,954,839 for the Strategic Reserve Fund. This brings the total funding for the SRF to $15 million, up from $6.3 million last biennium. This includes $4 million that can be used by Business Oregon for the new Business Expansion Program, SB 219 (see below). The Strategic Reserve Fund was established by the Oregon Legislative Assembly to support economic and community development in Oregon. Particular emphasis is placed on investments that assist communities, businesses or industries with cost effective projects that assist the creation, expansion, and preservation of traded sector industries of Oregon, and that encourage diversification and preservation of regional economies.
Business Expansion Program (SB 219)
Oregon lacks an incentive tool that can be used for companies with lots of jobs and high wages but small capital investments, who are looking to expand. Many of Oregon’s key programs like the Strategic Investment Program, Enterprise Zones and the Business Energy Tax Credit are targeted at companies with significant capital expenditures. This can leave out key drivers of employment and income such as software companies. Other states, for example Oklahoma, have had significant success creating jobs with incentive programs targeted at these types of companies. SB 219 creates the Oregon Business Expansion fund which can be applied to these labor intensive, high wage companies. We commend the legislature’s foresight in creating this tool in the middle of a recession. While it is tempting to retreat from investments in economic development in order to plug immediate holes, it is these types of investments in future job growth that will ensure we weather the next recession better and achieve our goals of lower unemployment and higher incomes.